Modal Operators: Click Object Event
Why type.event ?

You should get your event.type, and you may want to compare the event.value as well:

def modal(self, context, event):
    if event.type in {"LEFTMOUSE"} and event.value == "RELEASE":
        return {'FINISHED'}
    return {'PASS_THROUGH'}


Also, it might be possible that an event been stop propagate in most of the event handling system. You might need to check the context carefully to see what is the main problem.